25 Mar 2014

Ed Miliband accused of ‘inertia’ as real earnings turn corner

Some think today could prove to be a bit of a moment for a lot of private sector workers on median earnings. With inflation at 1.7 per cent and average private sector earnings at 1.7 per cent growth, are we turning a corner and what will that mean for a Labour campaign locked on to the cost of living crisis?

The IFS points out that public sector earnings are still below the private sector and that anyone on benefits will be feeling a squeeze in their cost of living. It also says it will be years, with a fair wind, before earnings get back to where they were before the crash in 2008.

That might not matter so much if you’re a floating voter on a middle income in a marginal seat and you think things are turning round under this lot and you don’t want to risk passing the baton to the other lot. The circling shark of interest rate rises is kept at bay a bit longer with inflation low.

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Which will all add to some of the doubts about Ed Miliband’s strategy. Some, mainly on the right, say the leader desperately needs to “stop banging one note again and again” on the cost of living, as one Labour frontbencher put it, when he is running out of time to convince voters he knows how to run the economy and get growth.

Others emphasise how the party needs to make some massive devolution of power decisions, not unlike the Heseltine plan to strip out Whitehall budgets and let Local Enterprise Partnerships bid for best use of resources, but spread across welfare, housing and much else.

Ed Miliband seems to some of these supporters a bit too nervous. His core supporters say there are juicy policies on the way on infrastructure, letting councils build homes, social care, potentially re-thinking tuition fees and cutting the amount you pay for university.

What unites all the signatories on that letter, from the left of Labour centre Compass group to the Blairite Progress group? “Was it a cry of pain?” I asked one supporter of the letter, a shadow cabinet member. “Yes,” he said, “against inertia.”

Another Labour frontbencher complained that good policy ideas go to Ed Miliband’s office to die. The inner team chews over abstract theories, prevaricates and then dilutes.

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